Earlier this week, the Detroit Tigers stunned baseball by signing Prince Fielder to a nine year deal worth almost $24 million per year. It was a case of the rich getting richer, as a Tiger roster that already includes superstars Miguel Cabrera and Justin Verlander plunked down a giant pile of money for another impact player. The Los Angeles Angels brought in big dollar players C.J. Wilson and Albert Pujols. And the Texas Rangers signed Japanese hurler Yu Darvish to a big contract after paying dozens of millions to his Japanese team just for the negotiation rights.
When Target Field opened in 2010, the Twins suddenly found themselves in the top 10 in baseball in total payroll, but suddenly teams like L.A., Texas, and Detroit are leaving the Twins in the dust. How is that possible?
Because all of those teams have better television deals than the Twins.
Texas signed an $80 million per year TV deal last year, and then the Angels topped it with one that may pay as much as $150 million per year. Even the Tigers have a high dollar TV contract. Theirs was signed back in 2008, and it’s worth about $40 million per year over 10 years. The Twins, meanwhile, will receive just $29 million this year from Fox Sports North for their television rights. As one online writer notes, that’s barely enough to cover Joe Mauer‘s salary!
I’m not going to touch the Angel contract. The Los Angeles area is far bigger than the Twins’ hometown, and Angel games are guaranteed to get higher ratings. The Rangers and the Tigers are a different story.Frankly, the fact that their television contracts are so much larger than the Twins makes absolutely no sense from a demographic standpoint.
I’ll grant that the Ranger TV contract should be a little more valuable than the Twins’ deal, because Dallas is a bigger city than Minneapolis. But it’s really not that much bigger. According to Nielsen TV market estimates, Minneapolis-St. Paul is the 15th largest television market in the country, with 1.73 million TV homes – only 700,000 fewer than Dallas. It is true that there are other metropolitan areas in Texas and Oklahoma that broadcast Ranger games, but Twins Territory also includes Western Wisconsin, the Dakotas, and parts of Iowa, which could potentially lead to millions more viewers. So while the Rangers’ TV network will have more viewers than the Twins, there’s no reason to expect that they should get nearly three times the money the Twins do.
Turning back to the Tigers, Detroit’s TV market is larger than Minneapolis, but only by 200,000 homes. The MSP TV market is also bigger than Miami, where the Marlins suddenly seem to be throwing money around, and St. Louis, where the Cardinals never seem to be low on money.
Furthermore, the Minneapolis-St. Paul area has the one of the highest per capita income totals of any U.S. Metropolitan area (the exact rank varies based on which source you check, but MSP is always near the top). According to this list, only San Francisco, Washington D.C., and Anchorage, Alaska are wealthier. Dallas is way down the list at #25, and Detroit is 16th. This is important because it means that Twin Cities area consumers have more money to spend, and thus advertisers should be willing to pay much more to buy time slots on Twins games, which in turn would make the games more profitable for a television station.
So the Twins have a reasonable-sized media market, and its consumers are among the wealthiest in the country. But somehow other teams are raking in the cash they need to sign big name free agents while the Twins are losing money and cutting payroll, thanks to their pathetic TV deal. Even though Detroit signed its TV contract in the heart of the recession, the Tigers still get $11 million per season more than the Twins.
Can anyone think of an explanation for this? Are the Twins’ media people just bad negotiators? Is Fox unwilling to commit to more money after a losing season? Are the missing pine trees somehow responsible?
Whatever the reason, the Twins need to fix it. It’s all well and good to have a beautiful ballpark, but it is becoming clear that teams need television revenues to compete in the modern game. There’s an $11 million difference between the Tigers’ contract and the Twins’ contract – just enough money to sign a reliable #2 starter or a power hitting outfielder.
I do not know how long the Twins’ television contract is in place, but hopefully it’s a very short term so that the team doesn’t fall too far behind in the money race.